Intercap Lending Realtor Event April 14th, 2014

“Creating Homeownership with Less Obstacles”

“We are at our best and we maximize our success when we Act Now”

Agenda     

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Arrival of Guest - Networking & Breakfast Welcome and Overview of the Agenda Introduction of Management Team History of Intercap Lending & Vision for the Future Intercap Lending Proprietary DPA Program Intercap Lending Foreign National Program Non-Prime, Investor & Business Loans Lunch is served Mortgage Access Program FHA Back To Work Program Business Planning: SNAP, Lead Gen. Business Planning Q&A Photography and Video

Welcome and Overview of the Agenda Eric L. Frazier, MBA National Sales Manager

Agenda          

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Introduction of Management Team History of Intercap Lending & Vision for the Future Intercap Lending Proprietary DPA Program Intercap Lending Foreign National Program Non-Prime, Investor & Business Loans Lunch is served FHA Back To Work Program Business Planning: SNAP, Lead Gen. Business Planning Q&A Photography and Video

Introduction of Management Team Jamil Atcha, CEO

Management Team        

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Ron Harsini, Chairman Clay Tol, COO/Director Capital Markets Mark Barley,Vice President of Retail Sales Jim Storm, Executive Vice President Lou Reda, Division Manager Tonna Rizzi, Credit Risk Manager Chris A. Arntson, Operations Manager Nick Rizzi, Logistics, Photographer,Videographer

Introduction of Management Team Jamil Atcha, CEO

History of Intercap Lending  

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From Asset Management to Lending Suburban Mortgage Company of New Mexico 1978 Direct FNMA, FHLMC, GNMA only 1% of lenders have these three key approvals 1 Billion in servicing Approved in 26 States

Intercap Lending DPA Program Eric Frazier, National Sales Manager

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Intercap Lending Proprietary DPA Program

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Intercap Lending Specialty Lending Programs Mark Barley, Vice President Production

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TPO Wholesale & Correspondent

Jumbo / Super Jumbo 

Jumbo ARM Product Menu

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30 Year Term on all Products

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Libor Index

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Interest Only option allowed on the 5 year product - Max LTV 60% 5/1 – 5/6 7/1 – 7/6 10/1 -10/6

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Loan Amounts to $5.0M

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Will consider loan requests to $10.0M case by case

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Exception based lending allows greater flexibility

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Unique Property types

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Complex Income situations

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Asset Based lending

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Loan Products & Features 

Vesting Title in Entities

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$250.00 One time document review fee LLC’s, Trusts, Partnerships Sub S Corporations

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Pledged Asset

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Loan Program - 90% financing for sophisticated borrowers $250.00 one time document review fee

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Niche Portfolio Lending

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Expanded property types Depletion of Assets for income Portfolio Lender -Expanded Guidelines Focus on A+ quality full doc Loans (700+ credit scores) Loan amounts to $5,000,000 million (May go higher, case by case basis) Exception Lending - With a simple process and quick turn-around

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Asset Depletion 

Liquid Assets can be used to qualify

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Amortized/Annuitized to age 85 or 30 years, whichever is less

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The following can be used to qualify: Self employed Income Trust fund recipient’s Borrowers who have large investment portfolios Complex Asset Portfolios

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Example

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Borrower’s income is $5,000/month /DTI is high…needs additional income to qualify

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Borrower has $1,000,000 “liquid” assets

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Mortgage calculation based on the borrower’s age:

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Present Value

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Rate

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Amortization

= 1,000,000 = 5.000% = 12 years The borrower is 73 years old

Result: $9,249/month additional income for qualifying purposes Borrower now has $5,000 income + $9,249 = $14,249 to qualify with

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Asset Depletion Qualification Eligible Assets 

Cash equivalent – CDs, money market, savings, and checking accounts

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Trust funds and investment portfolios – stocks, bonds, mutual funds, etc.

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Retirement accounts – only if the borrower is of retirement age Big Advantage for retired borrowers + shorter amortization

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Target DTI is 40%

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Important: subtract down payment before calculation

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Important: subtract required reserves before calculation (12-months full debt service – includes PITI on subject + all other payments)

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Asset Depletion is an underwriting tool only

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Pricing adjustment applied to the lock – 0.250 to price (not rate)

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TPO Wholesale & Correspondent

Foreign National 

Foreign National Borrowers

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60% Loan to value/$300k Minimum loan Sourced funds from a “known” Financial Institution Evidence income from country of Origin 3 Alternative trade lines Mortgage history or evidence of current housing payment Must have or apply for Tax payer ID number Investment properties on exception basis

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Non Permanent Resident Alien

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Will allow with less than 3 years remaining on visa Limited US credit Employment transfer from country of origin acceptable with verifiable offer letter

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TPO Wholesale & Correspondent

Expanded Property Types

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Unlimited acreage Hobby farms including: orchards and vineyards Condo projects are not required to meet Freddie/Fannie guidelines High rise condos High-end loft units CO-OP’s Luxury Condo-tel’s / 50% LTV Must have functional full kitchen 19

Income Property Lending

Property Types Multifamily

Housing

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5+ Unit Apartment Buildings

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Mixed use projects acceptable

Student

Housing

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Housing located within 2 mile radius of campus

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Bachelors, Studios, 1 bedrooms, Single Room Occupancy (SRO)

Mobile Mixed

Home Parks

Use

Commercial

Bridge Lending

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Intercap Non-Prime & Business Loans Linda Sachs-Gimbel, Product Specialist

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Non-Prime 

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“Smart Non-Prime” loan programs to those borrowers with less than perfect credit.

Programs Highlights:  

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Up to 80% LTV Available Bank Statement for Self Employed Cash Out, Owner Occupied with 500 FICO to $750,000 Owner Occupied with Foreclosure & Bankruptcy >3 years to 80% LTV Owner Occupied with Short Sale or Deed-in-Lieu >1 year to 80% LTV One day out of Foreclosure & Bankruptcy available 50% Debt to Income!!

No Prepay Penalties - Period!

30 year amortization, no balloons

LET'S GET BACK TO SMART LENDING

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NON PRIME LOANS MATRIX CREDIT GRADE "A" CREDIT GRADE "A -" FICO 700+ 650 + MTG 0X30 12 MO 0 X 30 1 X 30 BANKRUPTCY > 3 Years 3+ 3+ FORECLOSURE > 3 Years 3+ 3+ SHORT SALE / DIL > 2 Years 2+ 1+ PURCH to MAX 80% LTV 80% 80% R/T & C/O REFI to MAX 75% LTV 75% 75% MARGIN: 5:00% 5:00% 5.75% MAX RATE 8.35 8.95% MAX LTV 80% 80% LOW RATE 7% 7.60% LOW LTV 40% 40% GENERAL INFORMATION Property Types SFR / Condos / Townhouse / 2-4 Units Occupancy Owner / Non Owner / 2nd Home Loan Terms 30-Year Amortized & Term - 7/23 Hybrid ARM Loan Amounts $75,000 - $1,000,000 Income Documentation Full Doc = W2 + Pay Stubs / Wage Earner or 1040's + P&L / Self-Employed or Commission Alt Doc = 24 Month Personal or Business Bank Stmts / SE Only Maximum Debt-to-Income Ratio 50% Back End (43% for First Time Home Buyers <650 FICO) Index & Adjustment Caps Floored at Start Rate / 6 Month LIBOR Index 3% Initial Change Cap / 1% Semi-Annual Cap / 6.0% Life Cap Open: CA, CO, FL, ID, OR, TX, & WA Texas: Purchase Only OO / Purchase & Refinance NOO or 2nd Home

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CREDIT GRADE "B" 600 + 0 X 60 2+ 2+ SETTLED 75% 70% 6.95 9.25 75% 8.25% 40%

CREDIT GRADE "B-" 550 + 0 X 90 1+ 1+ SETTLED 65% 60% 7.50% 9.25 65% 8.85% 40%

CREDIT GRADE "C" 500 + 0 X 120 SETTLED SETTLED SETTLED 60% NO "HIGH COST" LOANS 7.95% 10.95% 60% 10.25% 40%

] BUSINESS USE â&#x20AC;&#x201C; OUTSIDE OF DODD FRANK 5 Year Interest Only / 15 Amort LTV Rate 50 8.95% 60 9.250 65 9.500

7/23 Hybrid ARM Rate 9% 9.25% 9.50%

GENERAL INFORMATION Property Types SFR / Condos / Townhouse / 2-4 Units Occupancy Owner / Non Owner / 2nd Home Loan Terms 20-Year Amort & Term 5 Yr interest Only to 15 Yer Fully Amort 30 - Year Amortixed & Term - 7/23 Hybrid ARM Index & Adjustment Caps Floored at Start Rate / 6 Month LIBOR Index / 6.950% Margin 3% Initial Change Cap / 1% Semi-Annual Cap / 6.0% Life Cap Loan Amounts $100,000 - $500,000

Income Documentation Stated Income / Verified Assets (If Applicable)*** ** Foreign National Funds to Closed Must be verified in US Dollars With Valid Banking Relationship in Country of Origin.

Impounds for Taxes / Insurance Required.

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Mortgage Access Program (MAP) Credit Analyzer and Rapid Rescore Mark Barley VP of Production

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Mortgage Alternative Program (MAP) 

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This program allows for buyers to purchase homes even with recent derogatory credit such as bankruptcy, foreclosure and short sale.

Minimum FICO requirement of 550 Alternative income documentation

How does MAP work?  

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The buyer is prequalified by ICL, and then they work with their Realtor to locate a property.

Property is approved by investor and then purchased for cash.

Buyer pays a “rent” payment that is roughly the same as a PITI payment at 4.5%.

Buyer then has up to 6 years to purchase the property back from the investor.

What does it cost? 

The fee for the service is 3% of the sales price. 

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This may be paid by the seller.

Buyer shall also deposit 5% of the sales price in an escrow account that will apply towards the purchase price when they qualify to buy.

MAP program will retain 3% increases in rent and appreciation each year until purchased.

Any additional appreciation belongs to the buyer.

What’s the catch? 

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There really isn’t one unless the buyer walks away and if that occurs, they will pay a 3% fee from the 5% deposit in escrow.

Improvements are allowed to the home even before it is purchased from the investor.

What a great way for buyers and real estate agents to work together even when financing is not available.

Credit Analyzer 

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We have the ability to pinpoint credit issues and guide borrowers on exactly what needs to be done to raise a score by a specific number.

This is usually done at the time of application so we can structure the loan around any cash that may be needed to pay accounts down or off.

We can run this service on each bureau and borrower individually.

Rapid Rescore ď ˝ ď ˝

Once a potential fix is determined, a rescore can be ordered and completed in about 48 hours.

We have funded loans for many borrowers that were previously turned down by other lenders who do not offer this service.

FHA BACK TO WORK PROGRAM Eric Lawrence Frazier, NSM

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Mortgagee Letter 2013-26 Back to Work - Extenuating Circumstances

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Minimum underwriting standards and criteria for evaluating borrowers who have experienced an Economic Event that resulted in a severe reduction in income due to a job loss or other circumstances resulting in reduced Household Income.

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Mortgagee Letter 2013-26 

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FHA is allowing for the consideration of borrowers who have experienced an Economic Event and can document that: Certain credit impairments were the result of a Loss of Employment or a significant loss of Household Income beyond the borrower’s control; The borrower has demonstrated full recovery from the event; and, The borrower has completed housing counseling.

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Mortgagee Letter 2013-26 

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The Economic Event, as defined in this ML, resulted in: foreclosure, short sale, bankruptcy or other negative impact on their credit, 

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In addition to meeting the guidelines set forth in this ML, loans originated using these criteria must meet all other applicable FHA eligibility and policy criteria.

Definitions 

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An Economic Event is any occurrence beyond the borrower’s control that results in Loss of Employment, Loss of Income, or a combination of both, which causes a reduction in the borrower’s Household Income of twenty (20) percent or more for a period of at least six (6) months.

The Onset of an Economic Event is the month of Loss of Employment/Income.

Recovery from an Economic Event is the re-establishment of Satisfactory Credit (as defined on page 5 of this ML) for a minimum of twelve (12) months.

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Satisfactory Credit 

Satisfactory Credit: Requirements

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The lender may deem a borrower to have Satisfactory Credit if: the borrower’s credit history is clear of late housing or installment debt payments, and major derogatory credit issues on revolving accounts; any open mortgage is current and shows twelve (12) months satisfactory payment history.

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Mortgages may have been brought current through loan modification, which may be “temporary” or “permanent” so long as all payments have been documented as being received in accordance with the modification agreement(s); and

Satisfactory Credit 

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Satisfactory Credit: if the borrower’s non-traditional credit history covering at least twelve (12) months in duration includes: No history of delinquency on rental housing payments; No more than one thirty (30) days delinquency on payments due to other creditors; and No collection accounts/court records reporting (other than medical and/or identity theft).

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Documentation of Economic Events ď ˝

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The lender must first analyze and document: (1) all delinquent accounts and (2) all indications of derogatory credit, including collections and judgments, bankruptcies, foreclosures, deeds-in-lieu, short sales, and other credit problems, to determine whether associated late payment, credit deficiencies or other credit problems were the result of an Economic Event, or an inability to manage debt or a general disregard for managing financial obligations.

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Documentation of Economic Events 

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To establish that borrower’s derogatory credit was the result of an Economic Event, the lender must review the credit report and determine that: the borrower exhibited Satisfactory Credit prior to the Economic Event Onset; the borrower’s derogatory credit occurred after the Economic Event Onset, and the borrower has re-established Satisfactory Credit for a minimum of twelve (12) months.

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Documentation of Economic Events 

Economic Event-Related Collections and Judgments

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The lender must verify and document all collections and judgments were the result of the Economic Event.

For borrowers with open collection accounts or judgments, the lender must also meet the requirements of Handbook 4155.1, Section 4.C.2.e, Analysis of Collections and Judgments.

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Documentation of Economic Events 

Economic Event-Related Mortgage Foreclosure

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The lender must verify and document that: a minimum of twelve (12) months have elapsed since the date of foreclosure or deed-in-lieu; and the foreclosure or deed-in-lieu was the result of the Economic Event.

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Documentation of Economic Events 

Economic Event-Related Short Sale

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The lender must verify and document that: a minimum of (12) months have elapsed since the date of sale; and the short sale was the result of the Economic Event.

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Documentation of Economic Events 

Economic Event-Related Chapter 13 Bankruptcy

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The lender must verify and document that: the Chapter 13 Bankruptcy was discharged prior to loan application and all required bankruptcy payments were made on-time, or a minimum of twelve (12) months of the pay-out period under the bankruptcy has elapsed and all required bankruptcy payments were made on time; and the bankruptcy was the result of the Economic Event.

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Documentation of Economic Events 

Economic Event-Related Chapter 7 Bankruptcy

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The lender must verify and document that: a minimum of twelve (12) months have elapsed since the date of discharge of the bankruptcy; and the bankruptcy was the result of the Economic Event.

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Documented Housing Counseling  

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The lender must verify and document that: the borrower has completed the required pre-purchase housing counseling by obtaining a letter from the borrower issued by the Participating Housing Counseling Agency on agency letterhead and that includes the agency’s Tax Identification Number (TIN).

The letter must state: the borrower’s name, the counselor’s name, that counseling was delivered in accordance with ML 2013-26 requirements, the date upon which counseling was completed, borrower’s signature and the signature of an authorized official of the counseling agency providing the counseling, and the borrower received the proper disclosures from the housing counseling agency.

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Questions Call FHA 

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Mortgagee Letter 2013 – 26 If you have questions regarding this Mortgagee Letter, please call the FHA Resource Center at 1-800-CALLFHA (1-800-225-5342).

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SNAP Speedy New Approval Process Mark Barley, Vice President - Production

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Speedy New Approval Process (SNAP)

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What is the SNAP used for? 

You have all probably been involved in a deal when the buyer’s loan went south resulting in a transaction that either closed late, or didn’t close at all.

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A SNAP approval is fully reviewed by an underwriter UPFRONT, so we can avoid any surprises.

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As a listing agent, when you see an offer that comes with a SNAP approval, you can rest assured that the transaction will go smoothly.

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If you are working with a buyer, make sure they qualify BEFORE you spend your valuable time. Get more offers accepted by promoting what the SNAP is and how it benefits all parties.

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Internet Lead Generation Lou Reda, Division Manager & Joe Freedman, Director of Marketing

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The Lender Partner Program

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Internet Lead Generation Providers

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Business Partners Helping to grow and expand your business

Jamil Atcha, CEO Eric L. Frazier, NSM

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Business Consulting 

We want to be your Business Partner 

You have many choices but having a partnership with Intercap Lending can make a difference in your business.  

We have the experience, resources and connections to help you grow.

Lets us help you devise a plan to achieve your goals:

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We can help you go to the next level We can help you generate more leads We can help you make your open houses more effective We can we help you close more deals

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Lets schedule a business planning session today.

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Questions and Answers Intercap Lending Team

THANK YOU FOR COMING! “Creating Homeownership with Less Obstacles”